Bonds round-up: Moderate rise as US employment dips
An unexpected fall in US non-farm payrolls in January revived fears of a US recession and boosted demand for government debt.
Non-farm payrolls fell 17,000 in January when the market had been expecting a rise of 50,000 or more. The January fall was the first slide in employment levels in four years.
US treasuries headed higher, albeit in sedate fashion. Although the employment data is bad, it contradicts more optimistic data from the private sector released earlier this week by payroll services firm ADP. The yield on the benchmark 10-year treasury note fell 2 basis points to 3.58%.
In the UK, gilts edged ahead as UK manufacturing growth slowed more than expected in January, while prices rose.
The Chartered Institute of Purchasing and Supply's manufacturing index fell from a downwardly-revised 52.4 in December to 50.6 last month, the worst read since August 2005.
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Economists had expected a slip to 52.5, still above the 50 mark above which indicates expansion, from an initial read of 52.9 the month before.
Input prices rose at their fastest pace in three years, up to 69.3 from 64.5 a month ago, and output price inflation hit a highest-ever 57.9, up from 55.6 previously.
The yield on the benchmark 10-year gilt fell 1 basis point to 4.47%.
European government bonds followed US treasuries higher, pushing the yield on the benchmark 10 year bund down 1 basis point to 3.92%.
